Wall Street remained in the red all day yesterday: the session started down and ended not far from the levels seen in early trading. In the end, losses were around 1% for all three indexes. The Nasdaq lost a little less ground than the S&P500 and the Dow Jones, thanks to Apple, which has benefited from a return of investor appetite over the past few sessions. This is because it offers a good compromise between robust results and defensive virtues in a technology segment whose riskiest part has been ravaged in recent months. However, Apple is definitely not the most affordable stock on the market in terms of earnings multiples. But investors are willing to pay the price for some form of tranquility during these difficult phases.

Jerome Powell will speak today at 2.30pm, after the Fed released its verdict on monetary policy. Why is this important? Because investors will confront their feelings with those of the central bank. For stock markets to rally, there probably needs to be some signals that the Fed has become more optimistic than investors, even if just slightly. Improved market sentiment often relies on subtle elements.

While the financial news revolves entirely around the Fed today, geopolitical tensions are still the global backdrop, with one of the most tense UN General Assemblies in recent decades. Russia is planning to hold emergency referendums in several areas of Ukraine that are considered pro-Russian. Some see it as a way for Vladimir Putin to try to regain the initiative after a difficult month of September for his troops on the ground. The Russian president, in an address this morning, announced a partial mobilization as of today, which caused the euro to fall and increased tension on markets.

On a lighter note, it was confirmed today that the chief operating officer of veggie steak specialist Beyond Meat was suspended, after an altercation with a motorist whose nose he apparently bit. The story does not say whether he was suspended for violence or because his attack was not really vegan…

 

Economic highlights of the day:

The August housing figures and the Fed's decision are the main events today. All the macro agenda here. 

The dollar is trading at EUR 1.0099. The ounce of gold is back down to USD 1672. Oil is slightly up, with North Sea Brent crude at USD 91.84 per barrel and US light crude WTI at USD 85.00. The yield on 10-year US debt is trending at 3.56% and the 2-year yield is flirting with 4%. Bitcoin is hovering around USD 19,000.

 

In corporate news:

* General Mills gained about 2% in premarket trading after raising its annual revenue and profit forecasts to incorporate higher prices and strong demand.

* Apple could make one in four iPhones in India by 2025, analysts at JPMorgan said Wednesday, as the U.S. company shifts some production out of China amid rising geopolitical tensions and health restrictions in China.

* Take-Two Interactive Software announced Wednesday that a hacker had gained access to its 2K Games division's support platform and sent a malicious link to some customers.

* Beyond Meat fell 2.6% in pre-market trading after announcing the suspension of its chief operating officer Doug Ramsey, following his arrest after an altercation.

* Coty gained 2.7% in premarket trading after it raised its revenue and margin guidance for the first quarter of 2023 as its beauty products met strong demand.

* General Electric confirmed Tuesday that it has hired Mavi Zingoni, a former Repsol executive, to head its energy division, which includes its gas and nuclear businesses.

* Micron Technology and Western Digital lost about 2% in pre-market trading after Mizuho lowered its recommendation on both stocks from "buy" to "neutral.

 

Analyst recommendations:

  • Arthur J. Gallagher & Co: Piper Sandler downgrades to neutral from overweight. PT up 8.8% to $195.
  • Autozone: Goldman Sachs raises price target to $2,334 from $2,296 amid strong results, maintains buy rating.
  • Fedex: Berenberg gives the stock a Neutral rating. Previously set at USD 275, the target price is lowered to USD 200.
  • Flutter: Citi downgrades to neutral from buy. PT up 12% to 11,500 pence.
  • Humana: Morgan Stanley upgrades to overweight from equalweight, adjusts price target to $549 from $494.
  • Huntsman: JPMorgan downgrades to underweight from neutral; cuts price target to $25 from $3.
  • Micron: Mizuho Securities downgrades to neutral from buy. PT up 10% to $56.
  • Nike: Barclays downgrades to Neutral
  • Oxford Industries: Citi upgrades to neutral from sell. PT up 10% to $105.
  • Reckitt Benckiser: AlphaValue upgrades to accumulate from lighten, targeting GBp 7396.
  • Redrow: J.P. Morgan downgrades from overweight to neutral, targeting GBp 550.
  • Rightmove: HSBC starts tracking at low, targeting 520 GBp.
  • Sotera Health: JPMorgan double downgrades to underweight from overweight, adjusts price target to $9 from $26
  • The Estee Lauder Co: Goldman Sachs upgrades to buy from neutral. PT rises 27% to $303.
  • Vistry: J.P. Morgan downgrades from neutral to underweight, targeting GBp 800.
  • Western Digital: Mizuho Securities downgrades to neutral from buy. PT up 13% to $40.